3G Broadband and Beyond – A Success Story

3G Broadband and Beyond – A Success StorySeptember 2008

2

3G Offers Mobile Broadband Today

All trademarks, names of other companies, logos, products and services may be the property of their respective owners

Global Mobile Broadband connections have risen by more than 850 percent year-on-year (Q1 CY07 – Q1 CY08), driven primarily from 3G (EV-DO and HSPA) –Wireless Intelligence

HSPA helped drive mobile data revenue growth of 46.1 per cent and wireless broadband revenue growth of 205 per cent in the first half of 2007/08.” -Dr. Hugh Bradlow, CTO, Telstra

StarHub consumer and corporate customers will now be able to experience high-speed access in Singapore of up to 7.2Mbps downlink and up to 1.9Mbps uplink with the use of HSDPA and HSUPA technologies respectively. -3G.co.uk, 2nd August, 2007

3G Offers Fixed/Nomadic Broadband Today

Source: 2

4

3G Operators Provide a Wide Range of Services

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Source: Wireless Intelligence, Dec 2007

Q1 2007 saw the first decline in GSM net additions in Western EuropeQ1 2007 saw the first decline in GSM net additions in Western Europe

Western Europe Net Subscriber Additions by Quarter

-2 million-2 million

14.6 million14.6

million

-4

-2

0

2

4

6

8

10

12

14

16

Q12004

Q22004

Q32004

Q42004

Q12005

Q22005

Q32005

Q42005

Q12006

Q22006

Q32006

Q42006

Q12007

Q22007

Q32007

Q42007

WCDMAGSM

Millions

Western Europe sees surge in WCDMA subscriber growth, while GSM continues to decline

Growth of 3G is Surpassing That of 2G

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• Convergence of Computing, Communication, & CE

• Multimode devices

Mobile Device EvolutionMobile Device Evolution

• Trends from wired to wireless

• Same rich IP apps everywhere

Network EvolutionNetwork Evolution

• Co-existence of multiple wireless technologies

• Common IP-based core networks

Service EvolutionService Evolution

Wireless Broadband Evolution Trends

7Verizon is a registered trademark of Verizon. All other trademarks are the property of their respective owners. Note: Products sold for use in U.S. are in compliance with recent ITC and Federal Court rulings.

Convergence of Computing, Communication and CE

8

CE Market Opportunities are Here Today

Computing Gaming Books User-GeneratedContent Entertainment

Samsung’s Q1 Ultra UMPC Amazon’s Kindle & Polymer Vision’s Librofonino

Nintendo’s DS Samsung’s VLUU i70 Cowon’s Q5 PMP

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Sprint & Amazon eBook –Example of a New Service ModelKindle• Launched in November, 2007• Service

- A wireless portable reading device providing access to books, blogs, magazines, and newspapers using high-speed EV-DO network.

- Over 300 newspapers, blogs, and magazines, and 90,000 books are available and can be downloaded in less than a minute.

- Delivers new content wirelessly, without a PC, Wi-Fi hot spot, or syncing.

- No monthly subscriptions or commitments for the service.- Built in dictionary and Wikipedia.

• Price:- $9.99 per book- $399 for the device - Subscriptions:

-Kindle magazines: $1.25 - $3.49 per month-Kindle newspapers: $5.99 - $14.99 per month-Blogs - 99¢ each per month

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Convergence of Devices & Services

3G & Beyond 2G 1G

PHONE EVOLUTION

MobileCommunication Information Entertainment / CE Rich

CommunicationUser Generated Content/

Social Networking Computing

+ + + + +

PC EVOLUTION

User Generated Content/ Social

NetworkingComputing Simple

Communication Information EntertainmentRich

Communication

+ + + + +

CONVERGENCEOF DEVICES & SERVICES

Connected ApplicationsRich ContentComputing ApplicationsHigh-Speed Access

Connected DevicesBluetooth HeadsetsMulti-Function CEMobile Computing

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Choice of Layered Networks with Common IP Core

High-performance 3G-WANs, with greatest coverage & scale, will provide ubiquitous broadband to billions of users

Opportunities abound for many technologies in the broadband future

4G Is Less about Performance than Ubiquitous Broadband Experienc4G Is Less about Performance than Ubiquitous Broadband Experience ande andSeamless Interoperability between Successful Wireless TechnologiSeamless Interoperability between Successful Wireless Technologieses

EconomicsEcosystem Evolution

Successful mass-market mobile broadband technologies excel at the 3 E’s

A thriving ecosystem includes successful operators generating revenue for theirservices, and innovative vendors/developers creating products/services that meet operators’ needs and fuel customer demand.

1) Ecosystem

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Source: Wireless Intelligence

670 Million+ Subscribers on 3G Networks Today

492 Commercial Networks127 EV-DO (35 Rev. A)276 CDMA2000 1X

194 HSDPA (34 HSUPA)216 WCDMA

15

2467

176

551

825

332 307261

138181

91

218

4 15 25 40 608

3G HSPA Family3G EV-DO FamilyWiMAXOthers, including TD-SCDMA, LTE and UMB

2007 2008

Growth of 3G Broadband Subscribers Is Explosive and Accelerating

3G will drive the majority of mobile broadband connections well into the next decade

20102009 2011 2012

25%67% 5%

3G will command 92% of the Mobile Broadband market

in 2012

Sources: Strategy Analytics, July 2007; Informa, September 2007. HSPA Family includes HSDPA, HSUPA & HSPA+. EV-DO Family includes Rel. 0, Rev. A and Rev. B.

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Vendors and Operators Are Realizing Significant Revenues from 3G

Sources: Blended forecast from Strategy Analytics (2006), Gartner (2006) and Forward Concepts (2005)

2009 Worldwide Revenue Estimates (Billions)

17

3G Offers Great Diversity Across All Segments

535 EV-DO devices / 107 vendors; 420 HSPA devices / 94 vendors

• Handsets and PC cards• Consumer Electronics• Ultra mobile devices• Embedded laptops • Desktops

Mobile/Nomadic/Fixed

Enterprise/Consumer• Ethernet/Cable/DSL-Class

Performance

Sources: CDG, GSA.

All Device Segments

All Market Segments

As operators evaluate options for rolling out wireless data services, they carefully assess each competing technology’s potential to maximize revenue while minimizing cost.

2) Economics

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3G Supports the Entire Range of IP Services

• Video/Music• Telco-quality VoIP

• Low-Latency Gaming• Push to Talk / Push to Media• Multimedia Upload/Exchange• High-Speed Web Browsing

• Streaming/Downloads• Video Telephony• Service Tiering

• Multicasting

Enabled by 3G’s Integrated Quality of Service (QoS) support, high capacity and low latency

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Operators Worldwide Show Data YoY Growth

Source: Verizon, Vodafone Group, AT&T, Telstra

21

$191$195

$407

$290

$228

$198$221

$341

$290 $295$270

$197

$231

$181 $176

$217

$270$254

$272$287

$311

$367

$141$129

$141$128 $128 $135

$105$124

$50

$150

$250

$350

$450

1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07

Lowest 10% Lowest Price

$28$23

$26

$35$37

$49

$59

$68

$77

$83$82

$70

$55

$43 $41

$20$20$24$24

$35

$51$49

$55$50

$57

$69$68

$48$42

$35

$10

$30

$50

$70

$90

1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07

Lowest 10% Lowest priced

CDMA2000 Handsets Costs

WCDMA Handset Costs

193267

351454

565683 730

0

100

200

300

400

500

600

700

800

2005 2006 2007 2008 2009 2010 2011

WCDMA & CDMA2000 Worldwide Handset Shipments

3G Device Cost Declining as Scale Increases

(Millions)

53%*

22%*

* Percentage of total handset shipments

Source: Average of Gartner Group (Dec 2006), Strategy Analytics (Oct 2006), ABI (Q1 2007), IDC (Dec 2006) and Yankee Group (Dec 2006) handset forecasts

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Internet Interconnect

Utilities

SparesTraining

Operations

RF Eng / Test Equip

Installation/Shipping

Project Mgt.Site Acquisition

Ancillary Equipment

Backhaul

Software Upgrade

BTS

BSC

MSC

Core Network

Other

Site Rental

Minimizing Number of Sites Is Important

Notes:• Urban morphology (10K Pops/SqKm)• Wireless penetration: 50%• Operator market share: 25%• Local call termination charges and long distance

transport costs are not included in the network expense calculations

• Spectrum available: 2X10MHz @ 800MHz

• Cost of each cell site is similar for all broadband technologies• Technologies requiring fewer sites have lower overall network cost

3G Network Example: Fixed/Nomadic Voice + Data Service

Capital Expenses

Operating Expenses

• 600 MOU /Sub/Month• 1000 MB /Sub/Month

Capital (% of Total Network Expense) 38%Ancillary Equipment 1%Installation/Shipping 11%Site Acquisition 1%Project Management 0%RF Eng / Test Equip 1%BTS 12%BSC 8%MSC 0%Core Network 3%Other 1%Operating Expense (% of Total Network Expense) 62%Site Rental 12%Operations 13%Utilities 3%Spares 2%Training 1%Software Upgrade 1%Backhaul 25%Internet Interconnect 5%

As with preceding generations, 3G technologies will continue to evolve, with timely improvements for greater capacity, lower cost, and higher data rates to support a myriad of voice and data services.

3) Evolution

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3G Technologies Have Strong Evolution Paths

EV-DO

Rev A

Rel-6 (HSUPA)

DO Advanced

Rel-9 & Beyond

Rel-9

Created 7/01/08

UMB

LTE

1x Advanced

Rev BPhase I

HSPA+ (HSPA Evolved)Rel-7 Rel-8

Rev BPhase II

EV-DO

Rel-8

EV-DO

OFDMA complements 3GLeverages wider bandwidths

EV-DO

Rel 0

CDMA2000

1X

HSPA WCDMARel-99 Rel-5 (HSDPA)

Excellent Mobile BroadbandVoice and Full Range of IP Services

Enhanced User ExperienceImproved voice and data capacity

Backward and forward compatibilityCost effective upgrades that leverage existing assets

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Peak Data Rates – Achievable in Optimal Conditions

Shared channel(downlink and uplink)

16/64QAMHigher order Modulation

2x2 MIMOMultiple Input Multiple

Output

Wider bandwidthMulti carrier

and/or OFDMA

Combinations of HOM, MIMO and

Multi carrier

Even Higher orderMIMO and HOM

Peak Data RateEnhancements EV-DO

Rev. A

UMB

LTE

DO AdvancedRev. BPhase I

HSPA+ (HSPA Evolved)HSPA Rel-6 (HSUPA) Rel-7 Rel-8 Rel-9 & Beyond

Rev. BPhase II

EV-DO

Rel-8 Rel-9

DL: 71 - 135 Mbps6

DL: 3.1 Mbps

DL: 71 - 143 Mbps6

14.7 Mbps2 DL: 34.4 Mbps3

DL: 1.8-14.4 Mbps DL: 28 Mbps DL: 42 Mbps4 DL: 84 Mbps5

DL: 9.3 Mbps1

1Peak rate for 3 EV-DO carriers supported by initial implementation. 2Peak rate for 3 EV-DO carriers with 64 QAM in the DL. Standard supports up to 15 aggregated Rev. A carriers.3DO Advanced peak rate for 4 EV-DO carriers as expected for initial implementation, assumes 2x2 MIMO and 64QAM in the DL. 4R8 will reach 42 Mbps by combining 2x2 MIMO and HOM (64 QAM) in 5MHz, or by utilizing HOM (64 QAM) and multi carrier in 10 MHz.5R9 and beyond may utilize combinations of multi carrier and MIMO to reach 84 Mbps peak rates. 6Peak rates for 10 and 20 MHz FDD using 2x2 MIMO, the standard supports 4x4 MIMO enabling peak rates of 278 Mbps for LTE and 288 Mbps for UMB. TDD rates are a function of up/downlink asymmetry

Enhancements available to both CDMA and OFDMACreated 7/1/08

10 MHz to 20 MHz

10 MHz to 20 MHz

5 MHz 5 MHz 10 MHz

5 MHz 5 MHz >5 MHz

26

Many Technologies Needed to Economically Deliver Broadband Experience Everywhere

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LTE

LTE Complements Existing 3G Networks

3G Coverage (HSPA/HSPA+ or EV-DO Rev A/B)

• Address high-traffic areas with LTE– 3G provides ubiquitous coverage

• Seamless service continuity with 3G – Seamless handoffs through multimode devices

• Evolved 3G provides similar user experience outside the LTE coverage

LTEHSPA+

Multimode

LTERev. B

Multimode

Industry’s first LTE/3G multimode solutions

LTEHSPA+/Rev. BMultimode

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Qualcomm Business Model

29

Qualcomm Invests Significantly in a Complete Technology Roadmap

Qualcomm Yearly R&D Expenditures

30

Qualcomm Has Helped to Enable a $350+B Industry

Industry: - CDMA/WCDMA Infrastructure Revenues- CDMA/WCDMA Handset Revenues- CDMA/WCDMA Service Revenues

Sources:Qualcomm Revenues – Company reportsHandset, Infrastructure and Service Revenues – Strategy Analytics, 2007

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• Industry leader in modem technology• Best-in-class RF & PMIC• Highest level of system integration

– Modem, Multimedia, RF, PMIC, Software• Leading-edge process & packaging

TECHNOLOGY

Single ChipEntry Level

Mainstream MMBroadcastQVGA/WQVGA

MSM6K

QSC

MSM7K

HLOS PhonesVGA/WVGA

Wireless & ConsumerConvergence

QSD

CUSTOMERS

Qualcomm Provides Broadest Solutions for Every Mobile Device Segment

Over 50 customersLaunched ~300 devices in 2007More than 350 devices in design and productionLaunching >30 phones per month

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Memory

Micro-ProcessorGSM/GPRS,

Edge, WCDMA, HSPA

DSPGPS

3D Graphics

Video

Audio

Imaging

CDMA, DO

DSP

SmallerForm Factor

Longer Battery Life

Lower Overall Costs

Highly-Integrated Chip Solutions

Software+

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Summary

3G has a strong evolution pathHigher capacity, peak and user data rates, enhanced user experience

3G offers excellent wireless broadband todaySupports all services, market/device segments with excellent economics

CDMA and OFDMA will provide similar performanceTopology will provide gains beyond technology

LTE complements 3G and its evolution Leverages new and wider spectrum up to 20 MHz

Qualcomm is a key contributor to 3G and beyondSignificant investments in EV-DO, HSPA(+), LTE, 1X-Advanced

Thank You